THE TAXPAYER ASSISTANCE CENTERS ARE NOT
LOCATED TO EFFECTIVELY SERVE THE MAXIMUM NUMBER OF TAXPAYERS

Issued on February 11, 2011

Highlights

Highlights of Report
Number:2011-40-022 to the Internal Revenue Service Commissioner for the Wage and
Investment Division.

IMPACT ON TAXPAYERS

The Internal Revenue Service
(IRS) provides taxpayers the option of obtaining personal, face‑to‑face
tax assistance at 401 Taxpayer Assistance Centers (TAC) nationwide.IRS employees who work in the TACs assist
taxpayers by interpreting tax laws and regulations, preparing certain
individual tax returns, resolving inquiries on taxpayer accounts, accepting
payments, and providing various other services designed to minimize the burden
on taxpayers in satisfying their tax obligations.It is important that TACs be optimally
located to serve the most taxpayers.Management information is essential to effectively oversee the TACs.

WHY TIGTA DID THE AUDIT

This audit was requested by the Department of
the Treasury to determine whether the current distribution of the TACs was cost
effective in terms of coverage and quality of services provided.This audit is a followup to prior audit
reports on the TAC Program that identified that key management information used
to make decisions and support changes for the TACs was either incorrect,
absent, or based on incomplete data.

WHAT
TIGTA FOUND

The IRS
acknowledges that the locations of most TACs have not changed significantly since
Fiscal Year 2000 and that it has not kept pace with shifts in population
and demographics.Currently,
35 percent of the United States population does not live within
30 minutes of a TAC.This represents more than 100 million taxpayers who do not
have convenient access to a TAC.Conversely,
28 percent of the United States population lives within 30 minutes of
more than one TAC.

As
of October 2010, no actions have been taken to combine, relocate, or close the
TACs.IRS officials cited budget constraints
and legislative concerns as reasons the IRS has not moved forward.This has caused the IRS to delay conducting
any cost-benefit or return-on-investment analyses needed to make any
recommendations regarding combining, relocating, or closing the TACs.

The
IRS has not validated the data used in the current Geographic Coverage Model.Without clear documentation on the
methodology used, it is difficult to determine if the results of the Geographic
Coverage Model are reliable.In addition,
it would be difficult to compare results over a period of time.

WHAT TIGTA RECOMMENDED

TIGTA
recommended that the Commissioner, Wage and Investment Division:
1) validate the data used in the Geographic Coverage
Initiative process and ensure that all decisions, along with the data used and
methodologies for making the decisions, are supported and documented; and 2)
identify opportunities to better align the TACs with taxpayer needs
and complete the evaluative process in the Geographic Footprint Initiative,
including a cost-benefit analysis, return-on-investment analysis, taxpayer
impact assessment, stakeholder input, and communication plan.

The IRS agreed with
the recommendations and plans to develop more detailed documentation of the
methodology used by the Geographic Coverage Model, as well as a version control
system to provide documentation of any changes made to the Model methodology or
updates to the source data.It plans to
identify opportunities to better align the TACs with taxpayer
needs on a case-by-case basis, as leases expire and/or events occur that
require unplanned relocations.It also plans
to develop and implement an evaluative process as part of the Geographic
Footprint Initiative.

READ THE
FULL REPORT

To view the report,
including the scope, methodology, and full IRS response, go
to: